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By David Olmos

Oct. 21 (Bloomberg) -- Amgen Inc., the world’s largest biotechnology company, declined after the company said third- quarter sales dipped and U.S. regulators asked for new studies on its experimental bone drug.

Net income, helped by lower spending on research, rose 24 percent to $1.39 billion, or $1.36 a share, in the third quarter compared with a year earlier, the Thousand Oaks, California- based company said today. Revenue fell 2 percent to $3.8 billion, led by a 19 percent drop in sales for Aranesp, an anemia drug used for cancer patients undergoing chemotherapy. The company raised its earnings forecast for 2009.

The company’s quarterly performance may be overshadowed by prospects for the bone-strengthening treatment, denosumab, which failed Oct. 19 to gain U.S. approval for women with osteoporosis. Amgen retreated as much as 6.1 percent to $55.75 in extended trading on the Nasdaq Stock Market after the release of the earnings report, then revived to $57.66 at 7:20 p.m.

“It’s a bit disappointing that the FDA will require more studies on denosumab breast and prostate cancer, but the treatment-induced bone-loss market is small,” Eric Schmidt, a New York-based analyst with Cowen & Co., said in an e-mail.

Amgen first is seeking approval for denosumab to treat and prevent osteoporosis in postmenopausal women. Chief Executive Officer Kevin Sharer has said the company is counting on denosumab, to be marketed with the name Prolia, to invigorate sales.

Prolia’s Prospects

“I remain optimistic about Prolia’s prospects to help patients with osteoporosis soon,” Sharer said in a telephone call with analysts.

The Food and Drug Administration on Oct. 19 asked for a formal plan for communicating Prolia’s safety issues to doctors and women with osteoporosis, which may delay introduction of the drug by several months. Regulators also asked for updated safety data related to the drug, Amgen said today.

The agency also will require new clinical studies for using Prolia to prevent bone loss in patients with breast and prostate cancer, additional approvals that Amgen is seeking. The studies would have to demonstrate that Prolia does not fuel tumor growth or shorten survival, Amgen said in a statement today.

Prolia could be approved for women with osteoporosis in two months after regulators receive Amgen’s response, said Bret Holley, an analyst at Oppenheimer & Co. in New York, in an Oct. 20 telephone interview. Holley lowered his 2010 global sales projections for the drug to $409 million from $510 million on anticipation of a “slight delay in approval.”

‘Enthusiastic’

“I’m still very enthusiastic about this drug, and I don’t think the delay should be that lengthy,” Holley said.

Cowen & Co.’s Schmidt said he expects Amgen to resubmit its response to the FDA for the treatment’s use in osteoporosis before the end of 2009 and gain approval by June 2010.

Amgen said third-quarter sales of Enbrel, a rheumatoid arthritis treatment that is its best-selling drug, increased 3 percent to $924 million, exceeding analysts’ estimates.

Aranesp sales fell 19 percent to $685 million from a year earlier. Analysts’ forecast sales of $699 million. Revenue from Epogen, an older drug used for patients with kidney failure on dialysis, rose 5 percent to $663 million.

The company said sales expenses declined 8 percent and the costs of research and development were cut 12 percent in the quarter from a year earlier.

Amgen also said today that further analysis of a trial in which patients with chronic kidney disease were more aggressively treated with Aranesp showed they were more likely to die of strokes and cancer than those taking placebos. The company released initial trial data Aug. 25.

Amgen said it was raising its earnings forecast for 2009 to $4.90 to $5.05 a share from the previous $4.80 to $4.95 a share. The company said revenue was “trending toward the upper end” of its prior estimate of $14.4 billion to $14.8 billion.

“I’m still very optimistic about our prospects to be an industry leader in growth,” Sharer said during the call.

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